The little dissolving thing is due to the shadow bias of the lights. On the properties tab of each light is a dial that says shadow min Bias. adjust it. The lightset above is the poser default lights all changed to raytrace. Let me call that up again and adjust then re render to show...

thou and I, my friend, can, in the most flunkey world, make, each of us, one non-flunkey, one hero, if we like: that will be two heroes to begin with. (Carlyle)